Pradhan Mantri Fasal Bima Yojana

The Pradhan Mantri Fasal Bima Yojana (PMFBY) was launched in 2016. It is a scheme that provides coverage against financial losses suffered by farmers due to various unfortunate events. It covers crop failure due to localized risks, post-harvest losses, natural calamities, unseasonal rainfall, pests, crop diseases, and so on.

The scheme operates under the motto ‘One Nation, One Crop, One Premium’ and aims to provide affordable crop Insurance to farmers in India. The goal of Pradhan Mantri Fasal Bima Yojana is to expand the penetration of crop in Insurance in India with a primary focus to cover total sown area in the country.

Objective of Pradhan Mantri Fasal Bima Yojana

PMFBY aims at supporting sustainable production in agriculture sector. By reducing the financial loss of crop failure, it helps stabilize farmer incomes. And when farmers have a stable income, they can invest in better farming practices, which in turn, brings several benefits.

Who is eligible for Pradhan Mantri Fasal Bima Yojana?

The scheme provides Insurance coverage to all farmers on voluntary basis for their crops as notified by the State Government. Following are the eligibility criteria for the PMFBY scheme.

All farmers including sharecroppers and tenant farmers growing the notified crops in the notified areas are eligible for coverage.

To avail coverage under the Pradhan Mantri Fasal Bhima Yojana, farmers should have insurable interest for the notified/insured crops.

Non-loanee farmers need to submit land records prevailing in the State such as Records of Right (RoR), Land possession Certificate (LPC), etc. and/ or applicable contract/agreement details/ other documents notified as permitted by the concerned State Government (in case of sharecroppers/ tenant farmers).

Coverage of PMFBY crop insurance scheme

Following stages of the crop and risks leading to crop loss are covered under the scheme:

Basic Product: The scheme covers the risk of: Standing Crop (Sowing to Harvesting): Comprehensive risk insurance is provided to cover yield losses on area approach basis due to non-preventable risks, viz. Drought, Dry spells, Flood, Inundation, wide spread Pests and Diseases attack, Landslides, Fire due to natural causes, lightening, Storm, Hailstorm, and Cyclone.

Add-On Coverage: Apart from the mandatory basic product, the states Govts./UTs ,in consultation with SLCCCI may choose any or all of the following add-on covers based on need of specific crop/area in their State to cover following stages of the crop and risks leading to crop loss:

• Prevented Sowing/ Planting Risk: If more than 75% of a notified crop area in an insurance unit remains unsown, or there is germination failure during sowing period due to adverse weather conditions such as deficit rainfall or adverse seasonal conditions, then the farmers are eligible for preventing sowing failure risk. The lump sum payout to insured farmers under this cover would be 25% of the sum insured and the insurance cover will be terminated.
• Mid-Season Adversity: Loss in case of adverse seasonal conditions during the crop season viz. floods, prolonged dry spells and severe drought etc., wherein expected yield during the season is likely to be less than 50% of Normal Yield. The pay-out to insured farmers under this cover would be 25% of the likely claims, subject to adjustment against final claims.

• Post-Harvest Losses: Coverage is available only up to a maximum period of two weeks (14 Days) from harvesting, for those crops which are required to be dried in cut and spread / small bundled condition in the field after harvesting, against specific perils of hailstorm, cyclone, cyclonic rains and unseasonal rains. Assessment of damage will be made on individual farm basis.
• Localized Calamities: Loss/damage to notified insured crops resulting from occurrence of identified localized risks of hailstorm, landslide, inundation, cloud burst and natural fire due to lightening affecting isolated farms in the notified area.